Report discovers 35,000 faulty water meters installed by Siemens

More than 35,000 faulty water meters were installed as part of the city’s $91 million energy performance contract with Siemens.

This was found out by private consultants who were hired by the city of Jackson last year to conduct a performance evaluation of Siemens. The report was released in October, and faults Siemens, its subcontractors and the city for complications related to the Siemens contract.

One of the biggest problems pointed out in the report was that more than 35,000 water meters installed had faulty batteries. Contractors also had not provided the city with the total numbers of meters that were installed as part of the agreement.

Siemens was hired in 2012 to completely overhaul the city’s water system. The contract called for installing some 65,000 new water meters across the city, implementing a new billing system and doing some water infrastructure work.

A performance assessment conducted by West Monroe Partners, a private consultant based in Chicago, determined that Mueller Systems, a subcontractor brought on by Siemens to install the meters, installed 35,566 devices that “historically have had battery issues.”

The report goes on to state that the meters “present an ongoing risk to Jackson if they fail prematurely (both in hardware and in labor costs).”

West Monroe also stated that as of October 2018, 8,079 of the new automated meters installed as part of the Siemens work “do not transmit reads” and that 185 meters had “active battery alerts.”

West Monroe was brought on last July to do a performance assessment of Siemens, its subcontractors and the city, about three years after work was completed on the contract.

The new “customer care and billing software (CC&B),” which was installed by Origin Consulting, a second Siemens contractor, went live in late 2015.

Since then, complications have ensued. In the spring 2018, the city learned that some 15,000 customers were not receiving statements. That number was revised to nearly 23,000 weeks later.

As a result, collections in water and sewer billing had dropped, and the water/sewer enterprise fund was in danger of going bankrupt.

West Monroe said Siemens, its subcontractors and the city are all at fault.

According to the report, which was released last October, “Siemens (had) fulfilled contractual terms of the performance-based contracts, although many of the contractual terms and conditions are unfavorable to the city.”

Siemens also was said to have provided “inconsistent qualitative information” regarding the total number of new (automated) meters that had been installed and were successfully working with the new billing system.

“Siemens did not use standard key performance indicators … making it challenging to assess the health of the systems.”

Those indicators included the number of estimated bills, meter reading errors, meter no reads, and the number of meters that had be exchanged, among others.

West Monroe states that Siemens should a project closeout summary to the city that better addresses “project methodology, key assumptions, successes, challenges, overall results and items for (the city) to address.”

Siemens also should provide a final report on the total number of meters installed and operating successfully.

Origin Consulting, the agency brought on to implement the new billing system, was cited for data quality issues. As of last October, Jackson had contracted twice with the Las Vegas-based company to help sort out billing issues.

In April 2018, the city amended its contract with Siemens, rehiring the firm and its subcontractors to help sort through the initial stranded bills. That contract ended on September 30. After that, public works retained Origin to help correct new stranded accounts.

Stranded is the term the city uses to describe accounts where bills are not being issued. Earlier this year, Public Works Director Robert Miller told the Sun that between 1,500 and 2,000 accounts were still being stranded each month, as a result of billing system problems.

“Origin has been contracted on two occasions to work stranded bills but there is limited data on overlap of stranded bills between engagements and if/how this effort is truly addressing the root cause of stranded bills,” West Monroe states.

West Monroe said that Origin also dropped the ball on training employees and offering support. “Staff members interviewed not use any reporting functionality to support their daily operations.”

Jackson wasn’t let off the hook, either.

West Monroe stated that there was “very limited accountability across the department and critical tasks are not being completed … Managers have limited visibility into staff performance and productivity.”

As for operations, billing department processes “are undocumented and many processes are paper-based, which results in missing and inaccurate data.”

While staff members told West Monroe they were under-trained, the consultants reported that city employees “have been provided training and manuals, but do not utilize these tools, particularly for CC&B.”

Additionally, employees “do not have a sense of ownership over this system. There has been significant turnover throughout the department, at both the leadership and line level, which compounds training issues.”

Consultants recommended 24 steps to address the problems, including developing and managing billing department operations, instill project ownership in city employees, and requesting updated meter information from Mueller. West Monroe also recommends the city task employees to review and follow up on meter and billing problems, and to work meter/billing errors on a weekly basis.

Jackson recently hired Lightfoot, Franklin and White LLC to determine whether the city should take legal action against the firm. Lightfoot’s investigation was ongoing at press time.

 

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